HOPEWELL INFRASTRUCTURE FY 2015 RESULTS

Revenue decreased 7.6% vs 2014
Net Profit (excluding FOREX gain) decreased 6.6% vs 2014
Net profit (including FOREX gain) increased 11.3% vs 2014
Current Ratio 5.94
Debt to Equity Ratio 0.05
Dividend for FY 2015 HK$0.42589 vs FY 2014 HK$0.226396, representing a 88.1% increase over 2014
Based on it present price of HK$3.74, the Dividend Yield is 11.4%

The drop in revenue is a concern as the full opening of the Coastal Expressway diverts traffic from Hopewell's GS Superhighway. However, the management is optimistic that the traffic diversion has been fully realised as the toll revenue from the GS Superhighway rebounded 2% in the H2 of FY2015 vs the 6% fall in H1 of FY2015.

The registered car population of Guangdong increased by 13% and reached a new record high of 13.3 million at the end of 2014, in which over 70% was accounted for the cities where Hopewell's expressways run through

It is noteworthy that Hopewell's Total Borrowings has dropped from HK$872.4 million in 2014 to HK$295.7 million in 2015. This represents a drop of 66.1% in borrowings, an great achievement indeed!

At is present price of of HK$3.74 and its attractive yield, Hopewell is a BUY purely for its recurring income, but investors should note that its capital appreciation is slow. Therefore it is only suited for investors looking for low risk exposures with good dividend yield.

My disclosure: I own shares of Hopewell Infrastructure.